Maharashtra government announced it might order the audit because private players are refusing to agree to a standard power tariff, claiming their costs are too high
Think you pay too much for electricity? The government might agree with you and is looking to put an end to it. Faced with allegations that private power distributors in Mumbai seek higher tariffs bys claiming inflating expenditure, the state government announced yesterday that it would get these companies audited by the Comptroller and Auditor General (CAG).
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This announcement came in the Legislative Assembly, after city BJP president Ashish Shelar raised the subject of introducing a uniform power tariff for the city in view of increasing electricity rates.
Energy minister Chandrashekhar Bawankule told the house that all companies, barring Reliance, were ready to adopt the uniform tariff for a monthly consumption up to 100 units. He added that he had told Reliance to fall in line and follow the same tariff, but the company said the standard rate would not cover their extra expenses of Rs 150 crore per year.
“Reliance asked us as to who will compensate for its extra expenses. I asked them to reduce their costs to bring the tariff down,” Bawankule told mid-day on the sidelines of the ongoing session.
But when Shelar and other legislators questioned tariff proposals of private operators and demanded that the CAG should be asked to audit the balance sheets of both Reliance and Tata Power, the energy minister welcomed the suggestion. Bawankule said it was the government’s right to know what these companies have been doing in terms of investment and power purchase, expenditures that reflect on the revision of tariff every year.
“If these companies don’t fall in line, the government will direct the regulator (MERC) to permit their balance sheets to be audited by the CAG,” the minister told this reporter.
Two other companies, BEST (a civic undertaking) and Mahavitaran, a state-government utility, get their accounts audited by government agencies. Sources said that the government was well aware of legal hassles it would face in commissioning the CAG audit because Reliance has consistently rejected a similar move in its Metro-I project, where tariff is, again, the bone of contention. A senior official said that the matter would most probably be fought in the courts.
Bawankule said that he would move a proposal to the CM’s office and get the law and judiciary department to work on it. The minister added that the audit period for Reliance should start from the year it took over from the erstwhile Brihanmumbai Suburban Electric Supply (BSES).
However, in Tata’s case, the experts will have to brainstorm over the approach, as the company is a century old. But there could be a way out, said a senior energy department officer.
“We may audit them from the year the MERC started determining tariff,” he said.
Reliance and Tata officials refused comment.
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